1 inch of water per SQFT is for those who want that golf green lawn. Until about 6 years ago I never watered my lawn and it remained reasonably beautiful with just normal precipitation. Now I only water my lawn when it's dry for extended periods. I water for only 15 minutes per section (whatever amount of water that equals to I'm not sure but I managed to do the whole lawn which is about 30x30 total which is about 1/3 inch per sqft).
Watering a 30x30 ft lawn with 1/3 inch of water is around 180 gallons, so if you're spreading 50 gallons over that lawn, you're only getting around 1/10th of an inch of water, barely enough to penetrate the soil.
So the point is, I get whatever I get out of the 50 gallons. It's water that isn't coming out of the city's water supply. Those that are more serious (such as some I know) will get a 1000 gallon tank installed at time of construction. Each 50 gallon saves me $10 (based on the lowest rate in the consumption chart) and based on my bills I figure I save between $25 and $40 a month.
Where do you live that you pay $0.20/gallon for water? In San Francisco, the water+sewer rate is closer to $0.02/gallon. The city with the highest cost for water + sewer in this chart is Atlanta, GA ataround $0.026 per gallon.
If you're refilling your 50 gallon barrel 2.5 to 4 times a month with rainwater, you probably don't need much water for irrigation anyway, sounds like you're already getting regular rain.